Palm closes retail stores, settles suit

They were never as cool as the Apple stores and now the Palm retail shops are no more, the company said.

Palm announced it was closing 8 standalone Palm stores and 26 stores found inside Airport Wireless outposts. The move was aimed at narrowing the focus of the company to better compete.

“We continue to focus our company around core business initiatives and are consolidating more resources behind fewer programs in order to compete most effectively and build world-class, category-defining mobile solutions,” the company said.

It’s the latest sign that the struggling maker of Treo smartphones is trying to reshape its business. The company, which received an infusion of cash and leadership from investor Elevation Partners last year, has been under the gun to turn around its fortunes, which have slipped in the face of competition from Research in Motion’s BlackBerry devices and the Apple iPhone.

The move will help the company focus on getting out its next operating system, which will be based on Linux. That is an important milestone for Palm, which has let its Treo operating system grow old.

Speaking of Treos, Palm also announced earlier this week that it will provide cash rebates to Treo 600 and 650 owners whose handsets were replaced or repaired at least twice. Qualified owners will receive rebates of $75 for an old Treo 600 and $50 for a Treo 650, good toward a new Palm device. The rebate stems from a settlement of a 2005 class-action suit. Palm said it will also repair any Treo 600 or 650 that hasn’t failed twice, but is outside of the original warranty.